A stage musical based on Cher's life, The Cher Show, is also set to debut in Chicago in June next year, before transferring to the Neil Simon Theatre in Manhattan.

Variety reports that Downton Abbey star Lily James will appear as the younger version of Streep's character Donna in the new movie, which will reportedly flash between past and present events.

Although Variety stated that the ABBA songwriting team of Benny Andersson and Björn Ulvaeus would provide the music for the new film, it is not clear if the new movie would include new music, or other ABBA hits that did not get an airing in the first musical.

Meryl Streep in a scene from Mamma Mia!

Mamma Mia! featured 18 of the Swedish group's songs, but many huge hits from their back catalogue could still be used for the sequel, including Waterloo, Ring Ring, Knowing Me, Knowing You, Fernando, I Do, I Do, I Do, I Do, I Do as well as the atmospheric fan favourite The Day Before You Came.

Mamma Mia! has been a multimedia success story since it premiered on stage in London in 1999. While it is still playing in London's West End, a New York production closed in 2015 after 14 years. Productions have been mounted in many other parts of the world.

The 2008 movie version grossed more than $600 million worldwide. It in turn spawned a theme restaurant - styled to resemble the musical's Greek island setting - in the Swedish capital Stockholm, with plans to open a second outlet in London.

ABBA songwriter Bjorn Ulvaeus pictured in May 2016 in the Mamma Mia themed restaurant in Stockholm, where people can eat while watching a show based on ABBA's songs. Picture: AFP/ Joanthan Nackstrand